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Removal of spare room subsidy is being subsidised further!

The government has announced an additional 35 million pounds to help claimants affected by changes to housing benefit in the social sector who need extra support.

The government introduced the "removal of the spare room subsidy" in April 2013.  While they attempted to present the change as removing a previously paid benefit (even though this was not recognised at the time), the move has been widely dubbed "the bedroom tax".  The level of housing benefit claimants receive is now dictated by the number of rooms they need in their home - if they are occupying a three-bedroomed house when they only qualify for two rooms, their housing benefit will be reduced accordingly.  Claimants can choose whether they want to pay the difference to their rent or if they want to move to more appropriately sized accommodation.  Therein lies the problem.

The "bedroom tax" has been widely criticised as penalising people who have little choice in housing.  This policy assumes that housing that meets the family's needs is available.  In many cases it is not.  How many one-bedroomed homes are available in your area, or even two-bedroomed homes?  If families had a choice of housing, and conciously selected to move to a house with a spare bedroom, then this "bedroom tax" may not be as widely criticised.  As it is, this debate is set to rage for a considerable time.

The fact that the government has to provide extra funding in this area implies that this may have been another policy made in haste. 

The £35m funding announced consists of:

  • £10m transitional payments to provide flexible funding for local authorities - distributed to councils based on working age social sector caseload, rent levels and regional levels of under-occupation.
  • £20m for councils, if they can demonstrate that they are managing their discretionary housing payment allocation in a robust, fair and appropriate manner.
  • £5m funding for the 21 most sparsely populated areas in the country. Additional guidance for local authorities will be developed to help direct support to claimants living in isolated rural communities.
30 July 2013

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